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| Local attorney David Keyes will be disbarred after 30-year career. Getty Images/Stockphoto |
A local lawyer will be disbarred after a state board found he misappropriated client funds.
The Michigan Attorney Discipline board issued an order of disbarment by consent for David Keyes, whose office is based in Fort Gratiot, on June 16. As part of the order, Keyes consented to punishment for allegations of professional misconduct.
His disbarment is effective July 8. He also was ordered to pay $787 in fees to the Michigan Attorney Grievance Commission.
A commission report states Keyes deposited client funds in his own personal bank account instead of into an account for the Kelly Law Firm, where he was previously employed.
"(The Michigan rules of professional conduct are) a high standard," Keyes said. "And I fell short of that standard. And not only did I fall short of the standards set by the rules, I fell short of my own standard.
"I recognize what I have done wrong and so it was important to me to take responsibility for my actions," he said.
Keyes is married to St. Clair County Assistant Prosecutor Melissa Keyes.
The attorney grievance commission report
The Michigan Attorney Grievance Commission report found that while representing two clients, Keyes asked that they pay legal fees directly to him, and he deposited the funds directly in his personal account.
Keyes filed an order on behalf of those clients without their consent that required them to pay $50,000 into the firm's account for ongoing litigation expenses and prohibited withdrawal from the account from any party except by mutual consent or order of the court. Keyes then asked those clients to send him a $50,000 check payable to him, which he deposited into his personal bank account in direct violation of the order, according to the report.
While representing a different pair of clients, he requested a $2,500 retainer, which he deposited into his personal account. When his clients entered into a $13,000 settlement agreement upon being told they would not be charged attorney fees, Keyes asked that opposing counsel make the settlement check payable to the firm.
As a result of this, those clients were sent multiple invoices for Keyes' legal fees totaling $15,500. When Keyes received the settlement check, he didn't tell his clients, and the check was applied to the outstanding invoices, the report said.
When Kelly Law Firm learned of Keyes' actions, the firm paid $13,000 to those clients and confronted Keyes, who did not deny mishandling the funds, the report said. Keyes repaid the firm. He was fired shortly after, according to the report.
The commission found that Keyes told 10 other clients to make initial payments for legal services in the form of checks made payable to him personally. Rather than depositing the checks in the firm's account, he commingled or misappropriated the checks by depositing them in his personal bank account prior to earning legal fees, the report said.
Keyes said the allegations occurred near the end of this time as an attorney. He was a private-practice civil litigator.
Kelly Law Firm said Keyes was fired in February 2020 and the firm filed a grievance with the attorney grievance commission shortly after.
Keyes said following his termination, he continued to practice law at his own office in Fort Gratiot.
John Adair, a member of Kelly Law Firm, said Keyes was employed with the firm for about 30 years.
"For more than 30 years, our firm has built a solid reputation for providing clients with valued legal counsel built on a foundation of honesty, and integrity, and trust. When we learned of Mr. Keyes’ unethical conduct we took swift and immediate action to expel him from the Firm, notify the proper authorities, and work with affected clients," according to a written statement from Kelly Law Firm. "We respect the decision of the Attorney Discipline Board for his disbarment from the practice of law, just as we respect the ethical practice of the law and the great responsibility and duty that entails."
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